4 equal owners of freehold - decision making process advice

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    4 equal owners of freehold - decision making process advice

    Hi All

    Apologies if this is in the wrong part of the forum, I've had a brief look and can't find anything relating to my query.

    We are 4 individual flat owners who have recently set up a Company in order to purchase an equal share of the buildings freehold.

    2 are owner occupiers, with the other 2 renting their flats. We are in the process of setting up a bank account of which we will all pay an equal amount into, to be used for running repairs to the communal areas etc. We all have a good relationship, and have the buildings interests at heart. However, how does the decision making work? For instance if there are 2 people who agree that a repair needs doing, and 2 disagree, how does that get resolved?

    Any experiences/advice gratefully received, I have given us all access to the password for this forum should any of us have further questions.

    Thanks for any help,


    First, welcome to the forum.

    Second, an anyoing statement by me.
    "have recently set up a Company in order to purchase an equal share of the buildings freehold"
    You don't have an equal share in the freehold. Each of you have a share in the company that owns the freehold. The company owns the freehold.
    ( Yes we know 4 flats, 4 owners, 4 shareholders ) but how many Directors of the Company ? I hope not 4, as that leads to problems as you have just found out.

    The Directors of the Company represent the freeholder and are required via the lease ( Read your lease ) to usualy " Keep the premises well maintained, in good order and repair".

    Those that cannot see a need to repair, or cannot visualise whats underneath something that may be required to be repaired, have either no understanding of how a building is constucted and that it slowly rots away, gutters neeed clearing before the down pipes get blocked, or just don't want to spend the money to comply with the lease ( Keep well maintained, in good order and repair) .

    There are many such setups such as yours, and we get it here, we cant afford it, but they don't say that, they just say it does not need looking at, or we will ignor it for the next 10 years.

    If ANY of you are quantity surveyors , or have an aptitude to see past "it's o.k. it will do" then fine, but leaseholders are not proficient to make these decisions often, and you have to EMPLOY a surveyor to look round the building and give an estimate as to what needs doing, but then you get, but we cant afford £ 600 for some one to tell us what needs doing.

    If all else fails, you can go to the FTT ( Formaly the LVT ) and state that the lease is not being adheared to, this and that needs doing, and they may well visit the property and if they find in favour of the application, order the freeholder to carry out the works.

    If above is too costly or complicated, or there is always conflict, again one of you can go to the FTT and ask for a manger to be appointed.

    Ask what qualities the people have, 2 for and 2 against the repairs.
    Sit down round a table and discuss why the repairs need doing or not.
    Ask each to state ..
    1) why it needs to be repaired or not
    2) what happens if it's not repaired.
    3) will the hole get bigger, will the timber underneath the xyz rot if we don't make sure abc joints are re-sealed.
    4) And much more I don't have time to go into as I can see it will be a hard task to get most repairs done. Seen it all before, been there, am still there.

    If you are close, I'll give you a talk, as most people think that when they buy the freehold, their bills will reduce. But they don't, as the place still has to be maintained.

    Also, as directors of the company, you HAVE to maintain the building, and it is no longer your own semi that you can let rot away, but a building for use by 4 unrelated people.


      Neil if you look in the FAQ there is section on buying the freehold and it answers your questions...

      Don' t forget

      1 the bank account that holds the service charge fund has to be separate from any account with the companies monies and held on trust
      2 that the calculation and timing of monies being asked for must comply with the terms of the lease as it is the contract between the freehold owing company and individual flat owners, even if they are shareholders.

      Moreover don't forget to look at your lease lengths for the reasons explained in the share of freehold myth section.
      Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.


        We hope all the leaseholders will read LHA's F.A.Q on buying the freehold.


        and that they all want to ensure the property is maintained, and as directors, they have to make decisions as a Director of the company, and not as leaseholders strapped for cash.


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